In August 2014, the town will have short-term bond anticipation notes coming due to the tune of $287,000. Many municipalities often roll those short-term notes into longer-term borrowing at higher interest rates. Bond anticipation notes often come with interest rates of less than 1 percent.

Three years ago, the finance board attempted to set up a schedule to pay down those notes as much as possible, reducing the amount of debt at higher interest rates the town carries. However, the schedule, as understood by the board, differed from the understanding of its financial consultant.

Board member Jeff Otto said the board must address how it will handle the miscommunication, and the surplus provides a remedy.

Brooklyn has short-term borrowing that will come due in future years as well. But the board also has the dueling priority of increasing the general fund.

Board Chairman Rick Ives said the surplus is significant enough that it will allow the board to do both. However, Ives said the Board of Education budget is already an area of concern. Superintendent Louise Berry reported in September special education costs had already skyrocketed.

“I think we will be having some challenges this year with the education budget,” Ives said.

Deary said he doesn’t want all the money to go into the general fund because even if the Board of Finance suggests it be used to pay down debt, a future board can ignore the request.

Instead, the board restricted $287,000 of the surplus to be used for the August debt payment and another $100,000 to be used to pay down short-term debt in the future.

“Once you put in reserve, you can’t take it out for something other than its intended use,” Deary said. “We will certainly have accomplished our goals with this.”

Ives said the restricted funds still leave $129,000 to go into the general fund.

“We can lock up some funds today without limiting our options to deal with issues that may come up in the future,” Ives said.